| Segment / Quarter | Q4 2022 | Q1 2023 | Q2 2023 | Q3 2023 | Q4 2023 | Q1 2024 | Q2 2024 | Q3 2024 |
|-------------------|---------|---------|---------|---------|---------|---------|---------|---------|
| Optical Communications ($M) | **1,195**  **[0001437749-23-002082_ex_426807.htm:3]**  | **1,125**  **[0001437749-23-010959_ex_459690.htm:5]**  | **1,070**  **[0001437749-23-020585_ex_515130.htm:2]**  | **918**  **[0001437749-23-028803_ex_555824.htm:2]**  | **903**  **[0001437749-24-002506_ex_540488.htm:2]**  | **930**  **[0001437749-24-013839_ex_601853.htm:1]**  | **1,113**  **[0001437749-24-023825_ex_672532.htm:1]**  | **1,246**  **[0001437749-24-032360_ex_708020.htm:1]**  |
| Display Technologies ($M) | **783**  **[0001437749-23-002082_ex_426807.htm:4]**  | **763**  **[0001437749-23-010959_ex_459690.htm:5]**  | **928**  **[0001437749-23-020585_ex_515130.htm:2]**  | **972**  **[0001437749-23-028803_ex_555824.htm:2]**  | **869**  **[0001437749-24-002506_ex_540488.htm:2]**  | **872**  **[0001437749-24-013839_ex_601853.htm:2]**  | **1,014**  **[0001437749-24-023825_ex_672532.htm:1]**  | **1,015**  **[0001437749-24-032360_ex_708020.htm:1]**  |
| Specialty Materials ($M) | **505**  **[0001437749-23-002082_ex_426807.htm:4]**  | **406**  **[0001437749-23-010959_ex_459690.htm:5]**  | **423**  **[0001437749-23-020585_ex_515130.htm:3]**  | **563**  **[0001437749-23-028803_ex_555824.htm:2]**  | **473**  **[0001437749-24-002506_ex_540488.htm:2]**  | **454**  **[0001437749-24-013839_ex_601853.htm:2]**  | **501**  **[0001437749-24-023825_ex_672532.htm:2]**  | **548**  **[0001437749-24-032360_ex_708020.htm:2]**  |
| Environmental Technologies ($M) | **394**  **[0001437749-23-002082_ex_426807.htm:4]**  | **431**  **[0001437749-23-010959_ex_459690.htm:5]**  | **457**  **[0001437749-23-020585_ex_515130.htm:3]**  | **449**  **[0001437749-23-028803_ex_555824.htm:2]**  | **429**  **[0001437749-24-002506_ex_540488.htm:3]**  | **455**  **[0001437749-24-013839_ex_601853.htm:2]**  | **431**  **[0001437749-24-023825_ex_672532.htm:2]**  | **382**  **[0001437749-24-032360_ex_708020.htm:2]**  |
| Life Sciences ($M) | **294**  **[0001437749-23-002082_ex_426807.htm:4]**  | **256**  **[0001437749-23-010959_ex_459690.htm:6]**  | **231**  **[0001437749-23-020585_ex_515130.htm:3]**  | **230**  **[0001437749-23-028803_ex_555824.htm:3]**  | **242**  **[0001437749-24-002506_ex_540488.htm:3]**  | **236**  **[0001437749-24-013839_ex_601853.htm:2]**  | **249**  **[0001437749-24-023825_ex_672532.htm:2]**  | **244**  **[0001437749-24-032360_ex_708020.htm:2]**  |
| Hemlock and Emerging Growth Businesses ($M) | **462**  **[0001437749-23-002082_ex_426807.htm:5]**  | **386**  **[0001437749-23-010959_ex_459690.htm:6]**  | **377**  **[0001437749-23-020585_ex_515130.htm:3]**  | **327**  **[0001437749-23-028803_ex_555824.htm:3]**  | **356**  **[0001437749-24-002506_ex_540488.htm:3]**  | **311**  **[0001437749-24-013839_ex_601853.htm:2]**  | **296**  **[0001437749-24-023825_ex_672532.htm:2]**  | **298**  **[0001437749-24-032360_ex_708020.htm:2]**  |

ca378a76a1d1640dec47ede7f8353dd88323440d11e2dc80e50a7d7d90762538

05b84c8e14569fde7c62b10a464333534044f3a804630fecc2272cb27d9f9114

Estimated Construction Cost ($ Million)

Estimated Undiscounted Lease Payments ($ Billion)

Estimated Purchase and Installation Cost of Equipment ($ Million)

a90def9b3f62423be8bf9ef54714cf204faa32a55ac706ebfb71fc4645f6a2d2

54a5fc39425c0a3ef35f37fca545e975e385c64e06c6019c191371d5b2037451

Corning Incorporated is a diversified technology company specializing in materials science and manufacturing. The company operates in several key segments, producing a wide range of products including network components, glass substrates, advanced optics, ceramic substrates, and laboratory supplies **[0001437749-24-003735_glw20231231_10k.htm:119]** **[0001437749-24-003735_glw20231231_10k.htm:2]**. Corning's offerings are integral to various industries, from telecommunications and consumer electronics to environmental and life sciences **[0001437749-24-003735_glw20231231_10k.htm:119]** **[0001437749-24-003735_glw20231231_10k.htm:2]**. Additionally, the company is involved in solar and semiconductor products through its Hemlock and Emerging Growth Businesses **[0001437749-24-003735_glw20231231_10k.htm:7]** **[0001206774-24-000283_glw4258981-def14a.htm:5]**.

1. **Optical Communications** - Develops and supplies carrier and enterprise network components, playing a crucial role in telecommunications infrastructure **[0001437749-24-003735_glw20231231_10k.htm:119]** **[0001437749-24-003735_glw20231231_10k.htm:2]**.
2. **Display Technologies** - Manufactures glass substrates used in flat panel displays, essential for consumer electronics **[0001437749-24-003735_glw20231231_10k.htm:119]** **[0001437749-24-003735_glw20231231_10k.htm:2]**.
3. **Specialty Materials** - Produces advanced materials such as Corning® Gorilla® Glass and advanced optics, catering to consumer electronics and other high-tech applications **[0001437749-24-003735_glw20231231_10k.htm:119]** **[0001437749-24-003735_glw20231231_10k.htm:2]**.
4. **Environmental Technologies** - Creates ceramic substrates and filters for emissions control, supporting environmental sustainability efforts **[0001437749-24-003735_glw20231231_10k.htm:119]** **[0001437749-24-003735_glw20231231_10k.htm:2]**.
5. **Life Sciences** - Provides laboratory products that are vital for scientific research and healthcare industries **[0001437749-24-003735_glw20231231_10k.htm:119]** **[0001437749-24-003735_glw20231231_10k.htm:2]**.
6. **Hemlock and Emerging Growth Businesses** - Engages in the production of solar and semiconductor products, contributing to renewable energy and technology sectors **[0001437749-24-003735_glw20231231_10k.htm:7]** **[0001206774-24-000283_glw4258981-def14a.htm:5]**.

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652a06fc4bd3c96742d7519cd007e0ccf99f036839b7faf9cd77ddad3e4d2465

| Program Details           | Program 1       |
|---------------------------|-----------------|
| Approval Date             | **2019**  **[0001437749-24-032912_glw20240930_10q.htm:40]**     |
| End Date/Duration         | No expiration  **[0001437749-24-032912_glw20240930_10q.htm:40]**  |
| Total additional amount   | **$5.0 billion**  **[0001437749-24-032912_glw20240930_10q.htm:14]**  |
| Remaining authorization amount | **$3.2 billion**  **[0001437749-24-032912_glw20240930_10q.htm:14]** **[0001437749-24-032912_glw20240930_10q.htm:40]**  |
| Details                   | May be amended or terminated by the Board at any time without prior notice  **[0001437749-24-032912_glw20240930_10q.htm:40]**  |

ef3907831a362e70410bb75193018f26895d8b4e5ce72bcc14fd3d41c4767176

1. In the competitive optical market where other suppliers are introducing smaller diameter fiber cables and high-density connectors, how does Corning intend to sustain its unique value proposition for Gen AI solutions, and can you specify how much of your optical revenue will come from customized solutions versus standard components?  **[GLW_3394981_21]** 

2. With gross margins showing **strong sequential and year-over-year growth**, what are the exact drivers behind this trend, and how do you plan to maintain or improve gross margins in the face of potential cost pressures or market fluctuations?  **[GLW_3394981_13]** 

3. Historically, your optical communications net income margin has averaged **13%**; looking forward, what strategies or market conditions would allow you to significantly exceed this margin, and is there a target margin level you aim to achieve?  **[GLW_3394981_16]** 

4. Regarding your **$8 billion SpringBoard opportunity by 2026**, can you provide a detailed breakdown of expected revenue contributions from the Carrier and Enterprise segments, and elaborate on the anticipated revenue impact of the Lumen agreement over the next couple of years?  **[GLW_3394981_9]** 

5. As the Enterprise segment becomes a larger part of your optical communications portfolio, how do the margins in Enterprise compare to those in the Carrier segment, and what steps are you taking to optimize profitability across both segments amidst shifting business compositions?  **[GLW_3394981_18]** 

96bcc08a8e240eb8840f13c2693d6f5d5ca4b948c5187268b9cc23a94ec1275f

- **CommScope Holding Company, Inc.** - Principal competitor in the Optical Communications segment  **[0001437749-24-003735_glw20231231_10k.htm:7]** .
- **Prysmian Group S.p.A.** - Principal competitor in the Optical Communications segment  **[0001437749-24-003735_glw20231231_10k.htm:7]** .
- **AGC Inc.** - Principal competitor in both the Display Technologies and Specialty Materials segments  **[0001437749-24-003735_glw20231231_10k.htm:7]** .
- **Nippon Electric Glass Co., Ltd.** - Principal competitor in both the Display Technologies and Specialty Materials segments  **[0001437749-24-003735_glw20231231_10k.htm:7]** .
- **Schott AG** - Principal competitor in the Specialty Materials segment  **[0001437749-24-003735_glw20231231_10k.htm:7]** .
- **Heraeus** - Principal competitor in the Specialty Materials segment  **[0001437749-24-003735_glw20231231_10k.htm:7]** .

54a5865722c438f13eb2b8772b5d88b2a7beae5faa7603b03c394fe25da41239

**Quarterly guidance for Q4 2024:**
- **Sales**: $3.75B  **[GLW_3404325_4]**  (raised from $3.7B  **[GLW_3394981_5]** )  
- **Earnings Per Share (EPS)**: $0.53–$0.57  **[GLW_3404325_4]**  (raised from $0.50–$0.54  **[GLW_3394981_5]** )

**Annual guidance for 2024:**
- **Capital Expenditures**: $1.1B  **[GLW_3404325_5]**  (no prior guidance)

**Annual guidance for 2025:**
- **Net Income for Display Technologies**: $900M–$950M  **[GLW_3404325_4]**  (no prior guidance)

**Annual guidance for 2026:**
- **Operating Margin**: 20%  **[GLW_3404325_5]**  (no prior guidance)

36ce490373a7f71b56a76ea786d04538ce71fc0fa7653d6e117f0cb746842f19

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bb75538a9ba68c810f6eda2b1e9802547c28b972d9d53f2c8d69af2622af38ae

1. **Optical Communications Growth**  
   **Q:** Will gen AI boost Optical Communications growth significantly?  
   **A:** Management expects gen AI to drive strong growth in their Optical Communications segment, with a **25% compound annual growth rate through 2027** in the Enterprise portion. Current momentum is even faster, and they will update their guidance at the investor event in Q1 next year.  **[GLW_3404325_10]** 

2. **Margin Expansion**  
   **Q:** Can gross margins improve beyond current levels?  
   **A:** Gross margins reached **over 39%** due to operating leverage from higher sales without adding capacity. Management believes there's opportunity to go higher, aiming for a **20% operating margin target** by the end of 2026, though not every quarter may be up.  **[GLW_3404325_11]** **[GLW_3404325_14]** 

3. **Display Price Increases**  
   **Q:** How are customers responding to display price hikes?  
   **A:** Customers are experiencing a **double-digit price increase** in the second half of the year. This aims to maintain stable U.S. dollar net income, delivering a **25% net income margin** next year and generating **$900 million to $950 million** in net income. Management remains confident in achieving this despite challenges in raising prices.  **[GLW_3404325_13]** **[GLW_3404325_18]** 

4. **CapEx Plans**  
   **Q:** Will CapEx increase with sales growth?  
   **A:** Management does not anticipate a significant increase in capital investments to deliver the Springboard plan. Current capital is focused on productivity improvements and reconfiguring factories. Unless moving towards an **$8 billion** revenue run rate, capital plans will remain relatively modest.  **[GLW_3404325_16]** **[GLW_3404325_17]** 

5. **Free Cash Flow Strength**  
   **Q:** Is strong free cash flow sustainable?  
   **A:** The company generated strong free cash flow in Q3 due to higher income conversion and lower capital spending. While every quarter may not reach this level, management expects to continue generating strong free cash flow going forward.  **[GLW_3404325_10]** 

6. **Hemlock Semiconductor Outlook**  
   **Q:** How will the CHIPS Act grant impact Hemlock?  
   **A:** They received a CHIPS grant to potentially build additional semiconductor capacity, which is a great opportunity. While it may not impact sales through 2026, it's an upside opportunity for the future.  **[GLW_3404325_12]** **[GLW_3404325_15]** 

7. **Carrier Segment Recovery**  
   **Q:** Will carrier sales return to past levels soon?  
   **A:** It's too early to confidently predict a carrier segment rebound. Recent customer announcements are encouraging, but more evidence is needed before declaring a market turn. Management will monitor developments closely.   

8. **Optical Margins Potential**  
   **Q:** Can Optical margins exceed historic levels?  
   **A:** As sales approach peak levels and capacity is filled, management expects Optical margins to improve beyond current levels. They believe margins will accrete as they grow and utilize existing capacity.   

9. **OpEx Expectations**  
   **Q:** Will elevated OpEx levels moderate soon?  
   **A:** OpEx was temporarily elevated in Q3 due to catch-up accruals from increased performance. While they won't have catch-up accruals in Q4, OpEx is expected to remain temporarily elevated in the fourth quarter.  **[GLW_3404325_13]** 

10. **Hemlock Milestones Timing**  
    **Q:** Any updates on Hemlock business milestones?  
    **A:** Progress continues on milestones to launch a new solar map, significantly contributing to the Springboard plan. Detailed updates are expected at the investor event in the first quarter of next year.  **[GLW_3404325_15]** 

85664d5466924f55c6e65daf3da98af9f22a22d10558d23f17b35e6960074797

| Name                        | Start Date | End Date | Reason for Change |
|-----------------------------|------------|----------|-------------------|
| PricewaterhouseCoopers LLP | 1944  **[0001437749-24-003735_glw20231231_10k.htm:79]**    | Present  | Current auditor   |

7ee97f4624660913b13c11f30e52128167105544de258aab15858f84a1240688

ab722f89ad8b8a4042edef32099e83042557d7f1db02cda835e7856873363818

f8422cce33766e5e275d4420951fc56a7a4e5afa3a2c940ac51d0d73bcbb280a

3c21255c97c6ffc06791988065d631bbdb98f0bb709a491c0146069bb53175af

- Corning's Optical Communications segment experienced significant growth, with Enterprise sales up **50%** for the full year 2024 compared to 2023, driven mainly by demand in the Gen AI data center space, and the company expects this momentum to continue into 2025.  **[GLW_3413521_16]** **[GLW_3413521_13]**
- The company anticipates improving net income margins in the Optical Communications segment as they enter 2025 due to strong sales growth and operational leverage, indicating enhanced profitability in this business.  **[GLW_3413521_8]**
- Corning generated strong free cash flow of **$1.25 billion** in 2024, up **42%** year-over-year, and expects free cash flow to continue to improve in 2025, providing potential for increased shareholder returns through share buybacks and possible future dividend increases.  **[GLW_3413521_14]** **[GLW_3413521_8]**

e9647af9427a59be0fc68922b0768f3200cc7ebe38e75b89e56d57f03a6a6d39

- **Risk of Cyclicality in the Optical Communications Segment**: Management acknowledges that the Optical Communications business has historically been **cyclical**, with periods of strong growth followed by downturns of **10% to 20%**. Despite current momentum and good near-term visibility into **2025**, there is humility that **build cycles can slow down**, potentially leading to sales not increasing as expected and impacting overall growth. "*We actually have pretty good visibility in what I would call the near-term... I'm always... humble... there can be periods of time where you have a build cycle that slows down.*"  **[GLW_3413521_16]**
- **Potential Delays in Revenue from Government Programs like BEAD**: Corning's anticipated growth from government-funded programs, such as the **BEAD program**, may be slower than expected. Management expresses **cynicism** due to the slow pace of government programs, stating that they are only seeing the **earliest trickles** of orders and do not expect significant impact on their numbers **until beyond 2026**. This indicates potential delays in realizing projected growth from these initiatives. "*I also shared that you should approach government programs with some degree of cynicism... we are starting to see the earliest trickles, but not enough for us to notice... I wouldn't take it as necessarily reinforcing nor would I say that it would all accelerate our view that this would begin to make a difference anytime between now and 2026.*"  **[GLW_3413521_17]** ,  **[GLW_3413521_12]**
- **Margin Pressures Due to Increased Costs in Optical Communications**: The Optical Communications segment experienced **margin pressures in Q4** due to increased costs associated with scaling up production to meet higher demand. Management notes that these costs had "**a little bit of an impact on our Optical margins here in the fourth quarter.**" If costs continue to rise to support growth, it could lead to ongoing margin challenges in this key growth segment. "*We have some costs to actually be able to serve the higher sales... and that is having a little bit of an impact on our Optical margins here in the fourth quarter.*"  **[GLW_3413521_9]**

437b43f836a3d0d2f8e6d75c448e457b3b2013027869e0ab84b0147768baa894

1. **Impact of DeepSeek on AI Buildout**  
   **Q:** How will DeepSeek affect AI buildout and Corning's business?  
   **A:** Corning does not see any negative impact on its Springboard plan to deliver over **$3 billion revenue by 2026** due to DeepSeek's announcements.  **[GLW_3413521_10]**  DeepSeek's innovations aim to reduce training costs, but the need for better compute and communications remains, supporting Corning's Optical business.  **[GLW_3413521_10]** 

2. **Optical Segment Margins and Growth**  
   **Q:** How should we think about Optical margins given strong growth?  
   **A:** Optical sales have ramped significantly, especially in Enterprise, and are expected to continue.  **[GLW_3413521_9]**  While higher sales have incurred some costs impacting Q4 margins, margins are expected to **improve in 2025**.  **[GLW_3413521_9]** 

3. **CapEx Guidance and Investments**  
   **Q:** What's driving the uptick in CapEx in 2025?  
   **A:** CapEx guidance is around **$1.2 billion**, close to depreciation of **$1.3 billion**, indicating no material capacity additions in 2025.  **[GLW_3413521_11]**  Investments are focused on necessary capacity and technological innovations rather than significant expansions.  **[GLW_3413521_11]** 

4. **Yen Hedging at 120 Rate**  
   **Q:** How did you achieve the 120 yen hedge rate at low cost?  
   **A:** Corning used various tools to hedge the yen at **JPY 120** with **low cost**, consistent with their historical hedging practices.  **[GLW_3413521_18]**  All costs are reflected in financial statements, and they've generated over **$2.5 billion** in gains over time.  **[GLW_3413521_18]** 

5. **Free Cash Flow and Dividend Growth**  
   **Q:** Will you resume dividend growth given strong cash flow?  
   **A:** Corning has started buying back shares and expects to continue.  **[GLW_3413521_14]**  They pay a healthy dividend and aim to reduce the payout ratio before increasing it, but resuming dividend growth is **not off the table**.  **[GLW_3413521_14]** 

6. **Risks to Non-Risk-Adjusted Plan**  
   **Q:** What are the major risks ahead to achieve the plan?  
   **A:** Key milestones remain in Optical, Solar, Mobile Consumer Electronics, and Automotive businesses.  **[GLW_3413521_7]**  For instance, further recovery in carrier deployments is needed in Optical; milestones in Solar are required for business scaling as reflected in the plan.  **[GLW_3413521_7]** 

7. **BEAD Program and Satellite Impact**  
   **Q:** Could BEAD rework and satellite impact your Springboard plan?  
   **A:** Corning has accounted for potential changes in the BEAD program and satellite deployment in their plans.  **[GLW_3413521_12]**  Modifications were made, but nothing changes their fundamental Springboard thesis.  **[GLW_3413521_12]** 

8. **Hemlock Minority Interest Surge**  
   **Q:** What's causing the surge in Hemlock minority interest income?  
   **A:** Hemlock had a strong Q4 due to back-end loaded polysilicon contracts, driving higher sales and income.  **[GLW_3413521_13]**  Corning plans to **break out Hemlock sales** in segment reporting starting in 2025.  **[GLW_3413521_13]** 

9. **Demand from Lumen and Specialty Materials**  
   **Q:** Are Lumen orders and Specialty Materials tracking as expected?  
   **A:** Lumen orders are coming in as expected, with anticipated demand.  **[GLW_3413521_15]**  The upgrade in Samsung's S25 phone aligns with Corning's strategy and positively impacts Specialty Materials.  **[GLW_3413521_15]** 

10. **Optical Business Cyclicality**  
    **Q:** How are you managing cyclicality in Optical going forward?  
    **A:** Visibility into 2025 is solid, with momentum expected to continue.  **[GLW_3413521_16]**  While acknowledging potential build cycle slowdowns, carrier behavior is not a significant driver currently.  **[GLW_3413521_16]**  Timing of capital cycles differentiates non-risk-adjusted and risk-adjusted plans.  **[GLW_3413521_16]** 

69178e543d3b334b02a443b8a263870d7d13c62351679fe0894e6945543a931e

Corning’s Optical Comm soared 50% YOY in 2024 Enterprise sales, fueling $1.25B FCF (+42%). Margins should improve in 2025 on AI data center demand. Watch cyclical risks and slower BEAD program ramp as potential headwinds for continued growth.

e5c24c2d66ff855eff475ed5e45ff6b8be17aa44ea2a761ed588ce38b67e58d4

6e04cb099892e97e5c9c949139105a6be66b21c255bcef5f5078017299f58fd2

**Quarterly guidance for Q1 2025:**
- **Sales**: $3.6B (10% YoY growth)  **[GLW_3413521_5]** **[GLW_3413521_4]** **[GLW_3413521_3]**  (lowered from 15% YoY growth  **[GLW_3404325_4]** )  
- **Core EPS**: $0.48–$0.52 (about 30% YoY growth)  **[GLW_3413521_4]** **[GLW_3413521_3]**  (lowered from about 40% YoY growth  **[GLW_3404325_4]** )

**Annual guidance for FY 2025:**
- **Display Technologies Net Income**: $900M–$950M with 25% margin  **[GLW_3413521_4]** **[GLW_3413521_3]**  (no change from $900M–$950M with 25% margin  **[GLW_3404325_4]** )  
- **Capital Expenditures (CapEx)**: $1.3B  **[GLW_3413521_4]** **[GLW_3413521_11]**  (raised from $1.1B  **[GLW_3404325_5]** )  
- **Yen Core Rate**: JPY 120 to the dollar  **[GLW_3413521_4]** **[GLW_3413521_11]**  (no prior guidance)  
- **Springboard Plan: add more than $3B in annualized sales by end of 2026**  **[GLW_3413521_5]** **[GLW_3413521_1]** **[GLW_3413521_2]**  (no prior guidance)  
- **Operating margin**: 20% by end of 2026  **[GLW_3413521_5]** **[GLW_3413521_1]** **[GLW_3413521_2]**  (no change from 20% by end of 2026  **[GLW_3404325_5]** )  

a56a0173f7da1847eb89a4ea063cf5ac339168c8d6ec0bdd4020fdeca30c136d

afb8b1e7ec0b42e4216426ed1dee6ad40d080179f8c7c88bbc83d8aaad1be05b

| Year | Amount Due (Millions) | Debt Type                     | Interest Rate (%) | % of Total Debt                                                                 |
|------|------------------------|-------------------------------|-------------------|---------------------------------------------------------------------------------|
| 2025 | 335                   | Current Portion of Long-Term Debt | N/A               | 4.5% = (335 / 7,408) * 100 **[0001437749-24-032912_glw20240930_10q.htm:2]** **[0001437749-24-032912_glw20240930_10q.htm:38]**                                     |
| 2025 | 340                   | Chinese Yuan-Denominated Loans | 2.8 - 3.9         | 4.6% = (340 / 7,408) * 100 **[0001437749-24-032912_glw20240930_10q.htm:40]**                                             |
| 2026 | ~€300 (~$320)         | Euro-Denominated Notes        | 3.875             | 4.3% = (320 / 7,408) * 100 **[0001437749-24-032912_glw20240930_10q.htm:9]**                                             |
| 2031 | ~€550 (~$590)         | Euro-Denominated Notes        | 4.125             | 8.0% = (590 / 7,408) * 100 **[0001437749-24-032912_glw20240930_10q.htm:9]**                                             |
| 2032 | N/A                   | Chinese Yuan-Denominated Loans | 2.8 - 3.9         | N/A                                                                           |

22f3a62d4d53dc4ecd9ba48f8159685e6265650a865ef546132f56da9a9f9e56

c81c3375bb5199e08b432b7403854a73d9f48db264e428d7c732a2380a457cae

Days sales outstanding (days)

Days payable outstanding (days)

Inventory turns (times)

e6ebac1b88e2247dc930536c669525bbd1d56998ed9d561b342e530f97b8f281

- **Corning has the capacity to add more than $3 billion in annualized sales within the next three years with minimal capital expenditure, leading to significant free cash flow generation.**  **[GLW_3381484_10]**
- **The company expects powerful incremental profits and margin expansion as sales grow, anticipating gross margins to increase from the current 37% level due to operating leverage.**  **[GLW_3381484_17]**
- **Improving demand trends in the Optical Communications segment, including growth from AI data centers and the expected impact of BEAD funding starting next year, will enhance sales and profitability.**  **[GLW_3381484_10]**

24b0f9479ab4bcc28aca9109ecfc10b5206d25c1074c68dd1879c27c0d058c33

- **Strong growth and attractive margins in the optical communications business**, especially in the **data center and AI data center space**, are expected to drive **EPS growth outpacing sales**, supported by the company's **cost, technical capabilities, and capacity**.  **[GLW_3394981_15]**
- The company believes that **net income margins** in the optical communications segment **can be above the historical average of 13%**, indicating **improving profitability** in this segment.  **[GLW_3394981_16]**
- The **strong adoption of Corning's Gen AI products** has led to **high visibility for strong growth**, with the company **picking up new customers** and experiencing **upside variance**, sustaining momentum over the next several quarters.  **[GLW_3394981_7]**

f4324255ac90f3a545465c2455812875bc2d01d32d647af3f950dc3df757435c

- **The company's Display Technologies segment faces continued weakness in China, which is expected to underperform and remain relatively below trend for the foreseeable future, potentially impacting demand.**  **[GLW_3371126_16]**
- **The translation of government broadband funding into actual demand in the Optical Communications segment is delayed, with expected impact starting only late this year, indicating potential near-term revenue challenges.**  **[GLW_3371126_9]**
- **Management is not willing to share details on the timing or impact of foreign exchange hedging for 2025, creating uncertainties regarding FX exposure and its potential effect on earnings.**  **[GLW_3371126_19]**

e45feb04c6789a0dc43ce715c3d6df4e67462e6337bfbe94bfabe9593626e0fb

- **Corning's Specialty Materials segment is not expected to contribute significant growth in the near term**. Management indicated that new innovations in this segment will not drive growth this year, impacting revenue prospects.  **[GLW_3381484_18]**
- **Uncertainty regarding the impact of government subsidies in China on the display market**. Corning is unable to predict how new Chinese home appliance subsidies will affect consumer demand, leading to potential risk in their Display Technologies segment.  **[GLW_3381484_11]**
- **Increased inventory levels and higher operating expenses could pressure margins**. The company reported higher inventory and operating expenses, and while management aims to keep OpEx flat, these factors may impact profitability.  **[GLW_3381484_14]**

ec279172badd35f369da59360a83b5bfa919b6e6a9bb9938f79017cce4949313

1. **$3 Billion Revenue Opportunity**  
   **Q:** What drives the $3B midterm sales growth?  
   **A:** Management expects an incremental **$3 billion** in sales over the next **three years**, as markets normalize and Corning's innovations contribute. The largest individual mover will be a **40% increase** in the Optical Communications segment, but growth is anticipated across all markets as they recover at different rates.  **[GLW_3371126_10]** **[GLW_3371126_11]** **[GLW_3371126_21]** 

2. **CapEx and Cash Flow Outlook**  
   **Q:** What's the outlook for CapEx and cash flow?  
   **A:** CapEx for 2024 is expected to be about **$1.2 billion**, below 2023 levels, as existing capacity suffices for anticipated sales. First quarter cash flow is guided to be **$200 million to $300 million** better than Q1 2023. Management expects continued progress on profitability and cash flow as sales rebound.  **[GLW_3371126_8]** **[GLW_3371126_20]** **[GLW_3371126_21]** 

3. **Optical Demand and Inventory**  
   **Q:** Any updates on optical demand and inventory trends?  
   **A:** Optical demand shows early signs of improvement, but it's too early to draw definitive conclusions. Carriers are deploying at higher rates than purchases, continuing to draw down inventories. Growth from hyperscale cloud customers is beginning, driven by new generative AI networks.  **[GLW_3371126_9]** **[GLW_3371126_13]** 

4. **Display Business Outlook and Pricing**  
   **Q:** How is the display business handling pricing and demand?  
   **A:** Panel maker utilization levels are very low in Q1 and need to increase double digits to meet even flat market demand. Management is adjusting prices to more appropriately share currency impacts and inflation with customers, aiming to maintain appropriate returns on invested capital. There's no significant change in market position due to pricing actions.  **[GLW_3371126_12]** **[GLW_3371126_14]** **[GLW_3371126_15]** 

5. **BEV Program Timing**  
   **Q:** When will BEV funding impact optical business?  
   **A:** BEV funding is expected to start translating into demand in late **2024**, becoming a more substantial driver in **2025** as grant awards turn into real programs.  **[GLW_3371126_9]** **[GLW_3371126_18]** **[GLW_3371126_21]** 

6. **Gross Margin and Operating Margin Improvement**  
   **Q:** How will margins improve with the $3B sales growth?  
   **A:** With existing capacity and fixed costs already in the P&L, gross margin should increase at a higher rate than current margins as sales grow. Operating expenses can remain stable while revenue increases, providing operating leverage and enhancing both gross and operating margins. CapEx needs are minimal, boosting free cash flow.  **[GLW_3371126_21]** 

7. **China Display Demand**  
   **Q:** What's the outlook for China display demand?  
   **A:** China is underperforming traditional demand trends in display and is expected to remain below trend for the foreseeable future. Management is not relying on a rebound in China for growth projections.  **[GLW_3371126_17]** 

8. **Currency Impact and Pricing Strategy**  
   **Q:** How is currency movement affecting pricing strategy?  
   **A:** With a weaker yen, customers are receiving lower real prices in yen while selling in dollars. Management is adjusting pricing to share currency impacts more appropriately, aiming to maintain appropriate returns. Details on hedging impacts for 2025 will be communicated later this year.  **[GLW_3371126_12]** **[GLW_3371126_19]** 

9. **Free Cash Flow Expectations**  
   **Q:** How is free cash flow expected to perform?  
   **A:** Management anticipates a strong year for free cash flow, benefiting from lower CapEx requirements and improved operating efficiency. No specific concerns affecting first-half cash flow expectations.  **[GLW_3371126_20]** 

10. **Gross Margin Stability in Q1**  
    **Q:** What supports gross margin stability in Q1?  
    **A:** Gross margin stability is supported by improved productivity, price increases to offset inflation, cost reductions, and better operational efficiency even at lower volumes. Management is confident in maintaining margins into 2024.  **[GLW_3371126_14]** **[GLW_3371126_21]** 

6d663c518a078d9443c8002f3d0c5c8da3aff18adddfd97bd7a35616abd4ce50

- **Continued inventory drawdowns** in the Carrier networks are negatively impacting sales in the Optical Communications segment, and **customers are not yet buying at their deployment levels**  **[GLW_3394981_19]** .
- **Increased competition** in the optical business, with **other suppliers making smaller diameter fiber cables and high-density solutions**, potentially narrowing Corning's competitive advantage  **[GLW_3394981_21]** .
- **Net income margin in the optical business is less than half that of the display segment**, raising concerns about the profitability of optical growth compared to display  **[GLW_3394981_15]** .

b3fb36e416ef8e4cfb4482a4025c4cc8284debb14e5d66fa72c0f64fa2790eb1

- **Optical Communications revenues are 30% below trendline** due to continued weak demand as carriers draw down inventory, with **limited visibility into recovery timelines**.  **[GLW_3361646_14]**
- **Lower panel maker utilization** in the Display Technologies segment is leading to **reduced volume** and uncertainty about when demand will improve, potentially impacting near-term sales.  **[GLW_3361646_9]** **[GLW_3361646_8]**
- There is a concern that the **long-term trendline in Optical Communications may reset lower** due to potential overbuild and higher interest rates affecting service provider investments, which could lead to a **lower steady-state revenue level**.  **[GLW_3361646_14]**

a767574bd2c3952ab9cb02a946ef67c9a0915321fdde32feec792bb8e9345278

- Corning expects a significant opportunity to increase sales by more than **$3 billion** without substantial additional capital expenditure, as markets normalize and demand returns to long-term trends, enhancing free cash flow and profitability due to operating leverage.  **[GLW_3371126_8]** **[GLW_3371126_11]**
- The company anticipates a **40% increase** in revenue for its Optical Communications segment as customer inventories deplete and broadband deployment accelerates, driven by underlying secular trends and government funding expected to translate into demand later this year.  **[GLW_3371126_9]** **[GLW_3371126_11]**
- Corning's gross and operating margins are expected to improve as volumes return since fixed costs are already in the P&L, leading to higher margin accretion without significant increases in operating expenses, boosting shareholder value.  **[GLW_3371126_11]**

b6d9bca2d344aeb87cb501ba2cbb19bb620c7d9b2472ec07ff3c8edcf778291e

1. **Optical Growth Visibility**  
   **Q:** How strong is your visibility into sustained growth in optical, especially Gen AI?  
   **A:** Our visibility for strong growth is **relatively high**, as we've been working directly with customers on customized systems based on their wiring diagrams for new data centers. We've been developing core components for the last few years and are already building some network needs ahead of installation. Positive word of mouth has led to **new customers**, driving upside variance.  **[GLW_3394981_7]** 

2. **Optical Competitive Moat**  
   **Q:** Is Corning's competitive moat in optical stronger now, particularly in enterprise?  
   **A:** Yes, we're building a moat driven by our **new-to-the-world fiber cable and connectivity system**, which only we can put together. Our new **super high-density systems** double the amount of light guides within the same volume while increasing performance. Our method is protected by intellectual property, increasing our competitive advantages.  **[GLW_3394981_8]** 

3. **Springboard Opportunity and Lumen Agreement**  
   **Q:** Can you split the $8B springboard opportunity between carrier and enterprise, and elaborate on the Lumen deal's revenue impact?  
   **A:** The majority of the opportunity comes from the **enterprise** segment due to Gen AI's impact on compute and networking needs. Regarding Lumen, it represents about **10% of our global fiber capacity**, so taking 10% of expected optical revenue puts you in the zone for sizing. The Lumen deal is exciting as it validates increased fiber needs for Gen AI data centers.  **[GLW_3394981_9]** 

4. **Further Similar Agreements**  
   **Q:** Do you anticipate similar agreements with other carriers?  
   **A:** While we can't speculate, Lumen's adoption of our new technology—which **doubles fiber capacity in existing conduits**—is generating significant interest, potentially leading to more agreements.  **[GLW_3394981_10]** 

5. **Enterprise Optical Growth Stability**  
   **Q:** How can we be confident in steady enterprise optical growth given potential variability?  
   **A:** We've accounted for potential variability in our **$5B springboard plan**, adjusting probabilistically. In the near term, our visibility is high; we guided for enterprise to grow at **25%**, but we achieved **40%** growth in the first quarter post-guidance. We feel comfortable about the 25% guidance provided.  **[GLW_3394981_11]** 

6. **Display Segment Price Adjustments**  
   **Q:** Is there a display price increase assumed in Q3 guidance?  
   **A:** We're not specifically guiding any display price changes at this time because we're in discussions with customers about a **currency-based price adjustment**, but that doesn't mean there won't be an impact in Q3.  **[GLW_3394981_13]** 

7. **Gross Margin Outlook**  
   **Q:** What are the drivers for gross margin growth?  
   **A:** We have the capacity and technical capabilities in place to support higher sales without adding fixed costs. This will drive both **gross margin** and **operating margin** improvements as sales grow. There's room for gross margin to continue increasing; our guidance implies this for Q3.  **[GLW_3394981_14]** 

8. **Display Utilization Rates and Market Share**  
   **Q:** What's the expectation for panel maker utilization rates in Q3, and will currency adjustments impact glass market share?  
   **A:** Utilization rates increased significantly in Q2 and may run at the same level or slightly lower in Q3 to average out for the year. Regarding currency-based price adjustments, our goal is to maintain our **net income margin** at historical levels over the last five years, and we intend to **hold our market share** through our approach.  **[GLW_3394981_14]** 

9. **Optical Profitability vs. Display**  
   **Q:** How will optical revenue growth affect net income compared to display?  
   **A:** We can continue to have **EPS growth outpacing sales**, regardless of growth source, due to existing capacity and capabilities. Margins in the optical business, especially in the **data center and AI spaces**, are quite attractive and can be above **13%** net income margin, higher than in the past.  **[GLW_3394981_15]** 

10. **Carrier Segment Outlook**  
    **Q:** How is the carrier side of optical performing and what's the trajectory?  
    **A:** Carrier business is increasing sequentially. Although down **year-over-year** due to prior inventory builds and current drawdowns, order rates are going up, and sales are up sequentially. Carrier order rates are approaching deployment rates, indicating an upward trend in year-over-year growth rates.  **[GLW_3394981_17]** 

11. **Enterprise vs. Carrier Margins**  
    **Q:** How do margins compare between enterprise and carrier in optical?  
    **A:** **Enterprise** margins are higher than **carrier** because it involves more customized connectivity systems. We share value created by reducing installation costs, leading to higher adoption and revenue share in enterprise.  **[GLW_3394981_17]** 

12. **Carrier Inventory Normalization**  
    **Q:** When do you expect carriers to align orders with deployments?  
    **A:** It's customer-specific, and we're not quite there yet. We'll make progress in Q3 but may not be fully aligned. We expect the gap to **close relatively quickly** and will update as we progress.  **[GLW_3394981_18]** 

13. **Display Pricing and USD**  
    **Q:** Will display price negotiations conclude by Q3, and could pricing move to USD?  
    **A:** We're in discussions and plan to update in September. We're engaging customers about moving to USD-based pricing or finding a way to appropriately share currency value changes. We aim to maintain profitability consistent with historical levels by pricing appropriately.  **[GLW_3394981_18]** 

14. **Optical Architecture and Gen AI**  
    **Q:** Does your current optical portfolio fit all hyperscaler deployments, and what's the outlook for traditional enterprise markets?  
    **A:** Our reported revenue comes from **fiber optic connections between switches**. There's ongoing work on whether server rack connections will become optical due to higher bit rates and distances. For traditional enterprise deployments and inference architectures, it's too early to determine predominant models. We'll share more as our understanding evolves.  **[GLW_3394981_19]** 

15. **Competitive Differentiation in Optical**  
    **Q:** What's unique about Corning's Gen AI optical solutions compared to competitors?  
    **A:** We participate at all levels, offering our new fiber to others and designing proprietary cables and connectors. Our unique advantage is reducing fiber diameter while **improving optical performance** without significant cost increases. Competitors often face performance decreases or higher costs when shrinking fiber. We aim for the majority of revenue from customized solutions adding value through reduced installation time.  **[GLW_3394981_21]** 

d3da25a387cf371922efe2202a47dc286f26f29d27d6e67fe026bffc8e05cc32

1. **Revenue Capacity & Investments**  
   **Q:** Where are the biggest opportunities for growth given $3B extra capacity?  
   **A:** Corning has capacity to support well over **$3 billion** in additional sales without significant capital investment.  **[GLW_3381484_10]**  Future growth opportunities depend on where sales come from, but they feel confident they can support growth above $3 billion with existing capacity.  **[GLW_3381484_10]** 

2. **Yen Hedging & Display Profits**  
   **Q:** How will yen hedging affect display business profitability?  
   **A:** Corning is committed to maintaining appropriate returns in the display business, using a combination of yen hedging and price increases to offset currency impacts.  **[GLW_3381484_9]** **[GLW_3381484_15]** **[GLW_3381484_19]**  They have made progress on hedging and will opportunistically build their 2025 hedge portfolio.  **[GLW_3381484_9]** **[GLW_3381484_15]**  It's too early to discuss core rates for 2025, but they aim to deliver similar economics regardless of yen fluctuations.  **[GLW_3381484_9]** **[GLW_3381484_15]** **[GLW_3381484_19]** 

3. **Gross Margins & Operating Leverage**  
   **Q:** How should we think about gross margin cadence going forward?  
   **A:** Gross margins have expanded by **300 basis points** despite sales declining by almost **$400 million**, due to improved productivity and price increases.  **[GLW_3381484_16]**  With a current baseline of **37%**, Corning expects gross margins to increase as sales recover, leveraging existing capacity and keeping operating expenses relatively flat.  **[GLW_3381484_16]** **[GLW_3381484_17]** 

4. **Data Center AI Opportunities**  
   **Q:** When will AI-related data center revenues impact financials?  
   **A:** Corning expects to see momentum in revenue growth from AI data centers starting in the back half of this year, assuming current orders ship as planned.  **[GLW_3381484_7]**  The shift to GPU racks increases fiber demand per rack by **8 times**, driving demand for Corning's innovative solutions.  **[GLW_3381484_7]** 

5. **Optical Comms & 5G Impact**  
   **Q:** How does 5G's performance affect Corning's telco business?  
   **A:** The transition to 5G requires more infrastructure, combining wireline and wireless networks, which offers cost savings and new revenue opportunities for telcos.  **[GLW_3381484_13]**  However, given muted deployment outlooks and inventory normalization, Corning anticipates a relatively modest increase in fiber deployments this year.  **[GLW_3381484_13]** 

6. **Display Cycle & Outlook**  
   **Q:** Is the display market cycle changing in duration or volatility?  
   **A:** Shifts in panel manufacturing to China are altering industry dynamics.  **[GLW_3381484_12]**  Panel makers now reduce utilization to match set makers' orders, potentially smoothing out traditional inventory-driven cycles.  **[GLW_3381484_12]**  It's early to tell if this change is long-term, but it could lead to a healthier industry with less volatility.  **[GLW_3381484_12]** 

7. **Inventory Levels & OpEx**  
   **Q:** Why were inventory and OpEx higher this quarter?  
   **A:** Inventory rose due to low sales volumes, but Corning expects to reduce inventory and improve cash flow as volumes increase.  **[GLW_3381484_14]**  Operating expenses were higher because variable compensation returned to normal levels after being lower in 2023 due to not meeting targets.  **[GLW_3381484_14]**  They aim to keep OpEx relatively flat, creating leverage as sales grow.  **[GLW_3381484_14]** 

8. **Specialty Materials Outlook**  
   **Q:** What's driving Specialty Materials' performance and outlook?  
   **A:** Specialty Materials performed as expected, and growth will come from adding more Corning content.  **[GLW_3381484_18]**  Smartphone units are expected to be up only **1–2%** this year, so significant growth depends on Corning's innovation and content additions, which are anticipated for future model years.  **[GLW_3381484_18]** 

9. **BEAD Timing & Optical Business**  
   **Q:** What's the outlook on BEAD funding's impact on optical business?  
   **A:** Corning expects BEAD funding allocation this year but anticipates spending to start next year due to governmental processes.  **[GLW_3381484_10]**  They remain conservative but supportive, acknowledging the requirement for U.S. content and the potential positive impact on their optical business.  **[GLW_3381484_10]** 

10. **China Subsidies & TV Demand**  
    **Q:** Could China’s appliance subsidies boost TV demand and glass volume?  
    **A:** It’s too early to predict the impact of China’s new subsidy programs on TV demand.  **[GLW_3381484_11]**  Corning is still analyzing how these subsidies will affect consumers but had previously expected muted retail demand in China this year.  **[GLW_3381484_11]** 

11. **Data Center Locations & Energy**  
    **Q:** Is there an opportunity with data centers seeking new energy sources?  
    **A:** Yes, Corning sees an interesting opportunity as data centers seek locations with spare energy capacity.  **[GLW_3381484_13]**  Their global footprint allows them to respond to these developments, potentially leading to innovation and volume growth.  **[GLW_3381484_13]**  However, it's too early to factor this into projections as infrastructure and energy sourcing are still being resolved.  **[GLW_3381484_13]** 

12. **Hedging Program Cost**  
    **Q:** Is the hedging program cost minimal to shareholders?  
    **A:** Yes, the cost of hedging is minimal, and Corning includes any hedging costs in their profitability calculations.  **[GLW_3381484_19]**  They are long yen and have generated approximately **$2.5 billion** in cash from hedging over time.  **[GLW_3381484_19]**  They aim to manage currency volatility through hedging and price adjustments.  **[GLW_3381484_19]** 

13. **Margin Targets**  
    **Q:** Can Corning reach 40% gross margins with the $3B sales growth?  
    **A:** Despite absorbing significant inflation and raising prices, which reduced margin percentages, Corning believes they can reach a **40%** gross margin as sales increase.  **[GLW_3381484_17]**  Adjusted for these factors, **38%** is considered the new 40% in old terms, and they are confident in achieving this target.  **[GLW_3381484_17]** 

a0946e102e60b6473147df0b2a91ac899b70365af919ecd9c991188beb3d8e98

Corning Inc (GLW)

Financials